“We have concluded that this proposed sale is not in the public interest and will likely create a significant effect on the availability or accessibility of health care services to the affected community,” acting chief deputy attorney general Michael Troncoso wrote in a letter released Tuesday.

California law requires the Attorney General’s Office to review sales of nonprofit health care facilities if its assets are held in public trust.

Harris’ office provided no further reasoning.

Prime Healthcare fired back, claiming the decision to be rooted in the Attorney General’s Office taking sides in a dispute with a major labor organization, the Service Employees International Union.

Victor Valley Community Hospital’s leaders declared bankruptcy about a year ago. Prime Healthcare is a for-profit company, and its nonprofit arm, Prime Healthcare Services Foundation, bid $31.5 million for the hospital.

“By denying the sale, they in fact close the hospital,” Prime Healthcare spokesman Edward Barrera said.

The union has accused Prime Healthcare facilities of a number of failings, including higher-than-normal reported rates of a blood infection called septicemia and malnutrition.

Prime Healthcare has in replied that SEIU’s allegations are an extortion campaign stemming from a labor dispute at an Inglewood hospital.

The state Department of Public Health is investigating the malnutrition claims, spokesman Ralph Monta o said.

California Watch, an investigative reporting service, in May published news that a state investigation found evidence that Prime Healthcare facilities overdiagnosed septicemia cases. Hospitals receive extra Medicare funding to treat that blood illness, according to that report.

Prime appealed, and Montano said the appeal is still pending.

SEIU issued a statement after the decision calling for all investigations to be completed before Prime Healthcare is allowed to buy more hospitals.

Andrew Edwards covers business and higher education for the Long Beach Press-Telegram. He has previously covered City Hall in Long Beach. He has spent his entire career in Southern California, having worked at publications including the Inland Valley Daily Bulletin, The Sun and Daily Pilot before coming to Long Beach. He graduated from UCLA in 2003 after studying political science and history.

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